Vicarious Liability Update

In 1999 the Supreme Court of Canada decided two cases involving employer's liability for sexual assaults committed by employees.

In Bazley v. Curry [1999] 2 S.C.R. 534, a non-profit association operating residential care facilities for children was held vicariously liable in an action brought by a former resident for sexual assault by a child care counsellor. The court unanimously rejected the argument that non-profit bodies should be protected from tort liability in the public interest, a position reaffirmed in the case Blackwater v. Plint discussed below. The relationship between the employer and employee was sufficiently close, while the wrongful act was a manifestation of risks inherent in the employer's enterprise. Liability was found against the foundation on the basis that the assaults took place in circumstances that flowed from its mandate, and the abuse of the authority given to the employee.

In Jacobi v. Griffiths, [1999] 2 S.C.R. 570 the majority of the Court found a non-profit Boys' and Girls' Club not vicariously liable for sexual assaults committed by its employee, the program director. Some of the assaults took place in the employee's home, and some of them in the course of excursions relating to children's sports activities.In applying the test set out in Bazley, the majority found that the required strong connection between the risks inherent in the employer's enterprise and the wrong had not been established. The employer organized recreational activities and the employee's job did not give him the degree of control or intimacy with respect to the children that would attract liability.

The test with respect to vicarious liability per McLachlin J. (as she then was) in Bazley and affirmed in Jacobi is two-step. First, precedents should be examined - are there decisions in cases dealing with similar fact situations which unambiguously determine whether the case should attract vicarious liability? Second, if prior cases do not suggest a solution, determine whether vicarious liability should be imposed in light of the broader public policy rationales behind the concept of strict liability. Bazley sets out a principled framework to apply this policy rationale to a particular set of facts (at paras 41-43). The factors to consider, as summarized in Doe v. Avalon School Board, [2004] N.J. No. 426 (N.L.) (Sup. Ct.)(discussed in detail below) include: (a) the risk of the wrongdoing must be sufficiently connected to the employer's enterprise, and the power and authority which flows therein; (b) there must be a sufficiently close relationship between the wrongdoer and the Defendant; and (c) the impugned action must be sufficiently connected to the exercise of the authority and power provided by the Defendant (at para. 31).

On October 2, 2003 the Supreme Court of Canada released its reasons in a trilogy of historical sexual and physical assault cases: K.L.B. v. British Columbia [2003] S.C.J. No. 51 ("K.L.B."); E.D.G. v. Hammer [2003] S.C.J. No. 52 ("Hammer"); and M.B. v. British Columbia [2003] S.C.J. No. 53 ("M.B."). In K.L.B. the Plaintiffs were all victims of abuse at the hands of their foster parents. The Plaintiffs sued, inter alia, the Crown. In Hammer, the Plaintiff was sexually assaulted by the school janitor and named the North Vancouver Board of School Trustee as a defendant. Finally, in M.B. the Plaintiff suffered a number of sexual assaults perpetrated by her foster father and also sued the Crown.

In K.L.B. the Supreme Court held that the Government was not vicariously liable for torts committed by the Plaintiffs' foster parents. The Court reasoned that because of the nature of foster care, governments could not regulate foster parents on a regular day-to-day basis. This was prompted by a policy encouraging foster parents to create an environment where children in foster care may experience a more traditional family environment. In furtherance of this policy goal, foster parents are permitted to act with a substantial amount of independence and autonomy. The Court also noted that foster parents did not hold themselves out as agents of the government nor were they perceived as such. The Court distinguished Bazley v. Curry because in Bazley, while the employees were to act as "parent figures", the care was provided in a facility overseen and managed by the Foundation and not in the employee's private homes.

The Court also distinguished K.L.B. from Lister v. Hesley Hall Ltd., [2002] 1 A.C. 215 (HL). There, vicarious liability was imposed on a company because it provided care in a boarding annex, and the warden of said annex would have been reasonably perceived as acting on the company's behalf. To illustrate this point, the Court observed that the care was provided in an annex, not a private home, and the warden of the annex received a salary, not the cost-recovery payments received by foster parents.

The Court also examined the policy basis for imposing vicarious liability. As such, the Court held that imposing vicarious liability would have little effect as a deterrent because of the independent nature of the relationship between foster parents and the Government. (In Curry, deterrence was held to be a key policy goal behind the imposition of vicarious liability.) Without this deterring effect, vicarious liability should not be imposed.

Similarly, in M.B. the Court held the Government was not vicariously liable for torts committed by foster parents against their foster children. The Court determined that foster parents were not acting "on account" of the Government (para. 16). For this reason, and for those discussed in K.L.B., the Court failed to find the Government vicariously liable.

There was no appeal on the issue of vicarious liability in Hammer presumably because in Jacobi v. Griffiths, the Supreme Court of Canada directly approved of the British Columbia Court of Appeal's finding in Hammer that vicarious liability did not exist. In Hammer, vicarious liability was not found because the janitor had no duties with regard to children. However, had the Board assigned work to the perpetrator work that required care or supervision of children, the result may have been different.

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